Ashcraft speaks on Caroline’s financial condition

From the County website:

Note:  The following letter was submitted for publication in the October 14 edition

of The Caroline Progress.

Dear Editor:

As County Administrator and Chief Executive Officer of Caroline County

Government, it is not my place or that of our employees to engage in political

debate or cast public opinions on policy matters. However, I do believe it is

sometimes necessary to sort out the details on issues and present the facts as

they exist on day-to-day operations within County Government.

There has been much said and written recently about the current financial

condition of Caroline County Government. It is not my position to editorialize on

the County’s total debt, its tax rate, or its future policy decisions. Those are

matters left for the Board of Supervisors to decide and I support each one of

them and react to the decisions made by the majority on every issue.

What has been called into question in recent public discussion is the

integrity of the financial operations of County Government and differing sets of

numbers in which the County’s finances are based. I would like to take this

opportunity to present factual information regarding the County’s finances as

adopted by Board policy and actions.

Amount of County Debt

As of the time of this writing, the County’s debt for projects related to

schools, utilities and the General Fund is $88,079,451.98. This was presented to

the Board of Supervisors at its September 14 meeting. These numbers include

debt related to the Dawn Wastewater Project and all cash flow loans that have

been undertaken.

The above mentioned dollar amount is the only debt that is included in the

financial operations of County Government. The debt service payments are being

made on schedule which reduces that amount with every payment. Only future

actions by the Board of Supervisors will add to the $88,079,451.98 should it

choose to do so.

One confusing point to some is an outstanding loan the General Fund

issued to the Utility Fund over a period of years. This loan was given out of the

County’s Fund Balance to cover debt and operations for the Utility Fund in lieu of

borrowing additional money and paying additional principal and interest. It is true

this shows as an obligation to be paid back by the Utility Fund, but it is not

recorded as a debt for accounting purposes. It is not costing the taxpayers of the

County for this inter-fund obligation to exist. In fact, the Utility Fund has begun to

pay back the amount in this year’s budget.

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Integrity of Financial Operations

The financial operations of Caroline County Government are governed by

the policies established by the Board of Supervisors and enforced by various

outside sources. Every year, Caroline County Government contracts with an

independent auditing firm to review the financial operations of the previous fiscal

year as required by state law. Any abnormalities in financial operations are

flagged by the audit and reported in the final document to the Board of

Supervisors. Over 11 years as County Administrator, there have been but a few

minor infractions related to financial procedures that were corrected immediately.

The annual audit is a public document that can be found on the County’s website

and copies are also available in the office of the County Administrator.

Caroline County also submits its audit as well as the cost transmittal report

to the Auditor of Public Accounts (APA). We also have to abide by the Uniform

Financial Reporting Manual established by the APA and the auditors have to

abide by the Specifications for Audits of Counties, Cities and Towns.

Caroline County must also follow Generally Accepted Accounting

Procedures (GAAP) which is governed by the Governmental Accounting

Standards Board (GASB).

All of this ties in with the policies and procedures adopted by the Board of

Supervisors.

The County Treasurer, Director of Finance and Davenport & Company,

the County’s financial consultant, are involved daily with the financial operations

of the County. The integrity of the financial structure is the single most important

aspect of County Government operations. The handling of public funds is a

tremendous responsibility that everyone assigned to those responsibilities takes

very seriously.  All of these individuals and agencies provide a strong system of

checks and balances for County government finance operations.

I would also add that County Government is meeting its financial

obligations to its employees, vendors and lending institutions. No expenses are

ordinarily past due or irregular in their payment schedules.

Increases in Department & Agency Budgets

The County Budget document sometimes presents a cumbersome

challenge for those trying to understand the operations of County Government

finance. Various public discussions have weighed in on the increases in various

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department and agency budgets over the years. Here is a 10-year range of the

larger County budgets for FY 2002 and FY 2011:

FY 2002  FY 2011

Education (local contribution) -    $8,073,175  $11,000,000

Sheriff -      $1,964,472  $4,181,689

Fire and Rescue -     $333,001  $2,512,298

Public Works Division -    $1,996,148  $2,796,441

Public Utilities -     $1,510,095  $6,982,125

Parks & Recreation -    $264,636  $415,756

Commissioner of the Revenue -   $354,979  $687,607

Treasurer -       $286,747  $481,949

Clerk of the Court -     $301,471  $534,078

Commonwealth Attorney -     $96,249  $379,440

Economic Development -    $161,287  $160,965

Planning & Community Development -  $363,888  $464,304

Public Library System -    $135,080  $331,131

Social Services (local transfer)   $341,111  $468,933

No Employee Layoffs

Chairman Maxie Rozell at the September 14 meeting of the Board of Supervisors

strongly expressed that there are no further layoffs planned for County

Government operations. That announcement gave County Staff the directive to

build the Budget for FY 2012 without further staff reductions.

Thank you for the opportunity to present these facts related to the operations of

Caroline County Government. All citizens and interested parties are encouraged

to contact my office at (804) 633-3499 or email at pashcraft@co.caroline.va.us.

We are also providing daily information on our County website at

www.visitcaroline.com as well as Twitter and Facebook.

Percy C. Ashcraft

County Administrator

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